Planning for Incapacity: Why a Will Is Not Enough
A will speaks only after death. If you are in a coma or lose mental capacity, your assets can be frozen while you are still alive, even for your spouse.
By Yog Bakshi, Manager, M&A
Published 11 November 20266 min
Key Takeaways
- A will takes effect only on death. It does nothing while a person is alive but unable to act.
- A bank nominee can claim funds only after the account holder dies. A nomination does not help during incapacity.
- A joint account operated “either or survivor” is the simplest safeguard for day-to-day money.
- A power of attorney helps when you are unavailable, but under Indian law, and likely also in the UAE, it generally ends when the principal loses mental capacity. It is not a full answer to incapacity.
- For larger estates, assets held in a trust or a foundation keep being managed by trustees or a council whatever happens to the founder.
The problem: alive, but unable to act
Anil, an Indian national living in Dubai, holds most of his savings in accounts in his sole name. After an accident he is in a coma for several months. His wife Sandhya needs money for his treatment and for the household. The bank will not let her operate his accounts. His will is no help, because he has not died. She is named as nominee, but a nominee can claim only after the account holder’s death.
The family’s only route is the court: a guardianship or similar order in India, and in the UAE an application for the court to appoint a representative or judicial assistant. That takes time, and in the meantime bills go unpaid.
What each tool does during incapacity
| Tool | Works after death? | Works during incapacity? | Comment |
|---|---|---|---|
| Will | Yes | No | Speaks only on death |
| Bank nominee | Yes (to claim funds) | No | Nominee acts only after death |
| Joint account, “either or survivor” | Yes, survivor continues | Yes | The co-holder can operate the account at all times |
| Power of attorney | No | Generally no | Authority generally ends on the principal’s loss of capacity, as well as on death |
| Trust or foundation holding the assets | Yes | Yes | Trustees or the council keep managing the assets |
| Court appointment | n/a | Yes, once granted | Slow and public |
The simplest step: a joint account
Anil could have added Sandhya as a joint holder and chosen “either or survivor” as the mode of operation. Both can then operate the account while alive, and the survivor continues after a death. Similar steps are available for some other assets, such as joint demat accounts.
The trade-off is control. A joint holder can operate the account at any time, not only when Anil is incapacitated. If Anil does not want that, he needs another tool.
Powers of attorney: useful, but not for incapacity
A power of attorney (POA) lets an attorney act for the principal: operating bank accounts, signing documents, dealing with property. It is valuable when a person is travelling or unable to attend in person. It must be properly executed: in the UAE, notarised (in person or through the notary platforms), and for use in India, stamped and notarised, and where executed abroad, attested or apostilled as required.
The limit is legal. A POA is a form of agency, and under Indian law an agency ends when the principal becomes of unsound mind or dies. India has no “lasting” or “durable” POA that survives incapacity. UAE law also treats a POA as an agency that ends on the death or loss of capacity of either party. The UAE’s new Civil Transactions Law (Federal Decree-Law No. 25 of 2025, in force from 1 June 2026) adds a court route: the court can appoint a judicial assistant for a person who cannot express their will. It is still a court process.
So a POA is a good tool for absence, and a poor one for incapacity. Banks may also refuse to act on a POA once they learn of the principal’s condition.
For larger estates: trusts and foundations
Where the assets are significant, the most reliable answer is to hold them in a structure that does not depend on the founder’s capacity:
- A private trust for Indian assets, with trustees named in the deed and a succession of trustees. See Private Family Trusts in India.
- A UAE foundation (DIFC, ADGM or another registry) for UAE and international assets. The council manages the assets under the charter and by-laws, and the founder’s incapacity does not freeze them. See UAE foundations.
Both need careful drafting of who decides what, and when. See also appointing fiduciaries.
Incapacity checklist
- List every bank, demat and investment account, and its mode of operation.
- Add a trusted joint holder (“either or survivor”) to at least one account used for household and medical costs.
- Keep a POA for periods of absence, knowing its limits.
- Keep nominations current, for what happens after death.
- For larger estates, consider a trust or foundation so that management does not stop.
- Tell the family where the documents are.
FAQ
Can my nominee use my bank account if I am in hospital?
No. A nominee can claim the funds only after the account holder’s death. During your lifetime, only you, a joint holder or a validly authorised person can operate the account.
Does a power of attorney keep working if I lose mental capacity?
Generally not. Under Indian law a POA is an agency that ends when the principal becomes of unsound mind, and India has no durable POA. The UAE position is similar. A POA should be treated as a tool for absence, not for incapacity.
Is a joint account risky?
It gives the joint holder full access while you are well, not only when you are incapacitated. Choose the joint holder carefully, and keep the amount in that account to what the family would need.
What does the court do if there is no planning?
In India the family applies for guardianship or a similar order. In the UAE the court can appoint a representative or, under the new Civil Transactions Law, a judicial assistant. Both take time and involve proceedings.
Talk to KCM’s succession team about incapacity planning: contact us.
Sources and last checked: 9 November 2026
- Mint, “Is power of attorney valid to sell a property if the original owner is mentally incapacitated?” (Trilegal, 29 October 2025): https://trilegal.com/wp-content/uploads/2025/10/Is-power-of-attorney-valid-to-sell-a-property-if-the-original-owner-is-mentally-incapacitated_-_-Mint.pdf
- Indian Contract Act, 1872, section 201 (termination of agency).
- UAE Federal Decree-Law No. 25 of 2025 (Civil Transactions Law), in force 1 June 2026: https://uaelegislation.gov.ae/en/news/the-uae-government-issues-a-federal-decree-law-promulgating-the-civil-transactions-law ; Afridi & Angell, “Legal Capacity, Minors and Judicial Protection under the New UAE Civil Code” (June 2026).
- Originally shared on LinkedIn by Suril Mehta: https://www.linkedin.com/posts/surilm_wills-share-7346622430246854656-Oas1/
This is not to be construed as legal advice. The actual advice will depend upon the facts and will have to take into consideration the case-specific facts and the anti-abuse regulations.